IPO Is Not A Key Factor Affecting The Market Trend. Meticulous Research Is A Kingly Way.

From the macro environment, China is still in the stage of replenishment in the first quarter, and the economic kinetic energy is not weak. In the middle of this year, real estate investment gradually contracted and declined slowly.

We expect that the market will be dominated by structural opportunities in 2017. The focus of investment strategy will be on the marginal improvement of selected performance and the allocation of industries benefiting from the support of national policies in order to obtain excess returns.

The overall trend of inflation is expected to be high and low. From the present point of view, the pmission effect of PPI to CPI is not obvious. The CPI in 2017 will be higher than that in 2016, but the rate is not large.

Based on the judgment of the economy and inflation, the central bank's monetary policy in 2017 did not have the basis of continued tightening, and stability remained the main keynote.

The central bank will continue to use the open market operation tools such as reverse repo and MLF to replace RR, as the main way to put liquidity.

Uncertainties in the macro scale are more from overseas, including imported inflation risk and US trade protection policy, which need continuous tracking.

OPEC production reduction agreement, such as the smooth implementation of the oil supply and demand structure will improve, the market is generally expected that the oil price center up to 50-55 US dollar range, such as the oversize of the uplink, will lead to the PPI, CPI overexpected,

In addition, Trump tends to maintain the weak dollar to reduce the US trade deficit and even demand RMB appreciation. According to the interest rate parity, the RMB exchange rate is too strong, which is also not conducive to the domestic liquidity environment.

In terms of microenvironment,

Profitability and valuation are good, providing a basis for the layout of sub sectors and stocks.

At the profit level, the overall profit growth rate of Listed Companies in 2017 is slower than that in 2016, but it can still maintain a positive growth.

A share's non financial performance growth rate in 2016 is expected to be around 16%, down to about 8% in 2017, and the gem's rejection of Wen's share is expected to increase by 35% in 2016, and in 2017, it will fall to 25%.

At the valuation level, the overall valuation of the A stock market has dropped to a reasonable interval. In addition to part of the cycle industries, the mainstream growth industry, electronic, computer, media, medicine and so on, PE valuation is close to the average or below the average value since 2010.

At present, some investors are worried about the "killing valuation" effect caused by the IPO speed increase. In the short term, the reduction of new returns will cause some new funds to be unable to cover the cost departure. However, according to historical experience, regulators will maintain the dynamic balance of IPO supply in the light of market conditions, and the overall stability is the main factor. IPO is not a key factor affecting the market trend.

In terms of market rhythm, there will be operational opportunities in the 2-3 months due to the marginal improvement in liquidity after the adjustment.

First, because of the easing of Trump's trading, the US dollar index has staged a pullback.

The decline narrowed and the RMB exchange rate stabilized.

In addition, although under the guidance of the central bank's financial leveraging policy, it is difficult for the monetary policy to be obvious for the time being. However, considering the effect of the Spring Festival, the central bank will carry out a moderate monetary market to stabilize the capital market, and the pressure on the rising interest rate of the long term debt will be reduced, thereby stabilizing the valuation level of the market.

Therefore, in view of the current market situation, I think we should not be too pessimistic, and we can gradually lay out the layout. In the middle of next year, China's economy will see the top down, and the US interest rate hike is expected to be strong again, and the risk of market withdrawal will increase the allocation ratio of robust industries.

Specific attention can be paid to three types of industry sectors: 1) robust and reasonably priced consumption segments can be used as a medium and long-term allocation direction, such as medicine.

2) the new infrastructure that benefited from the steady growth policy of the country, that is, the PPP plate, including the relevant companies in the construction, landscape and environmental protection sectors.

3) value growth stocks that meet the needs of pformation and upgrading and emerging industries, such as optical communications and Internet of things.

On the theme, according to the spirit of the central economic work conference, the agricultural supply side reform and the mixed reform of state-owned enterprises will continue to get policy catalysis, which will be an important direction this year.

Based on stronger information superiority, research ability and market sensitivity, professional investment institutions will have a higher degree of investment opportunities.

The investment and research team of NCB will adhere to the high standards and strict requirements, look forward to the promising direction of the layout, dig deep sub sectors and stocks, and watch out for risks, control withdrawal and obtain higher excess returns for investors.

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